Trading Update and Investor Day Presentation

Trading Update and Profit Guidance for the Half Year
ended 31 January 2020

Kathmandu Holdings Ltd
223 Tuam Street, Christchurch 8011 249 Park Street, South Melbourne, Victoria 3205
PO Box 1234, Christchurch 8140, New Zealand PO Box 984, South Melbourne, Victoria 3205, Australia
Phone: +64 3 373 6110 Fax: +64 3 373 6116 Phone: +61 3 9267 9999 Fax: +61 3 9267 9933
kathmanduholdings.com
KATHMANDU HOLDINGS LIMITED

ASX / NZX / MEDIA ANNOUNCEMENT

7 February 2020

Kathmandu Holdings Limited (ASX/NZX code: KMD) is pleased to provide this update on its sales and earnings
for the half year ended 31 January 2020 (H1 FY2020).

Group underlying EBIT for H1 FY2020 is expected to be c. 40% above the same period last year following the
successful acquisition of Rip Curl (completed on 31 October 2019). The Kathmandu Group results for the first
half of FY2020 will include three months of Rip Curl results from 1 November 2019 to 31 January 2020.
Underlying EBIT excludes the impact of the new IFRS 16 leasing standard, and one-off costs related to the
acquisition of Rip Curl.

OUTDOOR
Kathmandu achieved same store sales growth of +1.5% for the 26 weeks ended 26 January 2020. Online sales
grew by over 30% in H1 FY2020, underpinned by enhancements made to the online platform in the first half of
last year.

Kathmandu gross margin for H1 FY2020 is c. 1.4% below H1 FY2019, reflecting previous guidance on the
impact of year-on-year foreign currency movement.

Oboz continued to grow strongly, with sales c. 10% above H1 FY2019.

SURF
Rip Curl total sales for the three months of Kathmandu’s ownership are expected to be +2.7% above the
comparable three-month period last year.

Direct to consumer same store sales have grown by +2.6% for the 12 full weeks of ownership from 4 November
2019 to 26 January 2020.

Pleasingly, Rip Curl branded stores in Australia traded up +8.3% on a comparable basis in the important
summer trading period.

SUMMARY
Kathmandu Holdings Chief Executive Officer Xavier Simonet said: “We are delighted to have completed the
successful acquisition of Rip Curl, allowing us to significantly diversify our products, geography, and channels to
market.”

“The Christmas trading period has seen a further shift towards Black Friday and Boxing Day events. Low
December market foot traffic between these two events, unusually hot weather, and bush fires in Australia, have
combined to moderate first half sales. We have responded to these challenging Australian conditions by
focussing on operational execution, and we are pleased to have achieved same store sales growth for the first
half. Our diversification strategy has shown early benefits, with the Rip Curl surf focus helping to balance out
the Kathmandu business.”

Kathmandu Holdings Ltd
223 Tuam Street, Christchurch 8011 249 Park Street, South Melbourne, Victoria 3205
PO Box 1234, Christchurch 8140, New Zealand PO Box 984, South Melbourne, Victoria 3205, Australia
Phone: +64 3 373 6110 Fax: +64 3 373 6116 Phone: +61 3 9267 9999 Fax: +61 3 9267 9933
kathmanduholdings.com
CORONAVIRUS UPDATE
The Group sources product from a diverse range of markets throughout Asia, and is actively monitoring any
developments on its supply chain as a result of the Coronavirus outbreak in China.

There is not expected to be a material supply impact in the short term as sufficient inventory levels are held,
assisted by the longer stock turn nature of technical product categories. Impact on consumer demand across
the Group is currently not significant.

The Group has mitigation plans in place if there is a prolonged disruption to our Chinese suppliers.

Kathmandu will release the full result for the half year on Monday 30 March 2020.

ENDS

This announcement has been authorised for release by the Board.
For further information, please contact:

Media
Helen McCombie
Citadel-MAGNUS
Tel: + 61 2 8234 0103
Investors
Eric Kuret
Market Eye
+61 417 311 335

---

INVESTOR DAY 2020

Chairman
David Kirk

•A global outdoor and action sports
company, consisting of three iconic brands:
•Kathmanduspecialisesin quality clothing
and equipment for travel and adventure.
•Obozdesigns ‘True to the Trail®’ outdoor
footwear to help people explore the
wilderness.
•Rip Curl is a leading global surf brand born
in Bells Beach, Australia in 1969.
With a shared focus on expertly designed,
technicaland sustainableproducts, our brands
are distributed through wholesale, retailand
digitalchannels.
Iconic Brands
INVESTOR DAY 2020

Phase 1: Implemented a new management team ~5 years ago
-Focus was on optimisingthe performance of Kathmandu’s
assets, improving Australasian sales and market penetration,
optimisingprofitability and elevating the Kathmandu brand.
Phase 2: Acquired Obozin March 2018 to increase product
and geographic diversification
-Advanced transformation from an Australasian retailer to a
global outdoor apparel and equipment brand
-Consistent with international growth strategy to pursue lower
risk wholesale model
-Successful integration demonstrated that Kathmandu is
capable of integrating complementary businesses, while
preserving brand and cultural identity
Evolution of Kathmandu Holdings’ growth
INVESTOR DAY 2020

0
2000
4000
6000
8000
10000
29-Jun-151-Apr-163-Jan-177-Oct-1711-Jul-1814-Apr-1916-Jan-20
$1.00
$1.50
$2.00
$2.50
$3.00
$3.50
Volume
('000)
Price
23.1% CAGR since 29 June 2015,
29.5% CAGR with dividends re-invested
Volume KMD XDJ Rebased Average Volume
Evolution of Kathmandu Holdings’ growth
2015-2019 performance evolution prior to Rip Curl acquisition
-7.4% sales CAGR over the last 4 years
-EBIT has increased by $51m to $84.3m and NPAT has nearly
trebled to $57.6m
-Dividend has doubled and share price has increased at 23% CAGR
Phase 3: acceleration of diversification strategy with Rip Curl
acquisition: today’s investor day is about bringing the Rip Curl story to
life and articulating why we believe Rip Curl is a great asset in our
portfolio.
INVESTOR DAY 2020

11:00am: Welcome
David Kirk, (Chairman)
11:10am: Group strategy update
Xavier Simonet (Group CEO)
11:25am -Rip Curl brand,
business and strategy
Michael Daly (Rip Curl CEO)
11:55am -Product innovation and
distinctiveness
Nichol Wylie (General Manager Product)
12:20pm -Brand marketing
Michael Daly (Rip Curl CEO)
12:45pm -Finance and integration
Chris Kinraid (Group CFO)
1:00pm -Lunch
1:45pm –Office tour
2:30pm –Flagship store visit
Agenda
INVESTOR DAY 2020

Group Chief Executive Officer
Xavier Simonet

Vision for the Group
Maintain brand affinity and cultural alignment while
leveraging capabilities and delivering synergies.
INVESTOR DAY 2020
Kathmandu, Obozand
Rip Curl to leverage
respective strengths
and build on each
others’ competitive
advantages over time
Kathmandu,Obozand
Rip Curl to retain their
strong brand identities
and cultural values
Kathmandu, Obozand
Rip Curl to retain
operational ownership
of their respective
businesses

Benefit 1 –Diversification of Kathmandu
INVESTOR DAY 2020
Product and
geographic
diversification
reduces seasonality
of earnings and
reliance on
Australasia

Benefit 2 –Growth enabler by leveraging capabilities
INVESTOR DAY 2020

•Sourcing: capitalisingon the combined scale of
Kathmandu and Rip Curl to improve gross margin,
quality, costs and diversification
•Systems and IT:
-benefit over time from system integration between our
three brands.
-benefit from Kathmandu’s online experience and
capabilities to support Rip Curl’s online growth
•Supply Chain: leveraging the strengths of both
Kathmandu and Rip Curl in Australasia as well as
internationally to accelerate growth and drive efficiencies
•International launch of Kathmandu: existing wholesale
networks provide a platform for us to launch our
Kathmandu brand in overseas markets
We expect most synergies to be achieved over the medium
term.
Benefit 3 –Synergies expected over the medium term
INVESTOR DAY 2020

•Rip Curl is an iconic global brand with a strong loyal customer base focused on designing and bringing to market
technical products
•Combined group meets the year round needs of customers globally
•Rip Curl complements Kathmandu:
•Global presence with established distribution network in the US, Europe and Asia
•Expertise in summer outdoor and beach apparel
•Expertise in the wholesale channel internationally
•A number of shared capabilities that will be leveraged over time:
•Technical products
•Seasonal specialists
•Outdoor adventure ethos
•Commitment to core customers
•Brand building and inspirational content
Why Rip Curl?
Creating a global outdoor and action sports company
INVESTOR DAY 2020

Chief Executive Officer - Rip Curl
Michael Daly

a

RIP CURL:
BUSINES
OVERVIEW

25%
22%
16%
11%
4%
22%
123456
41%
21%
19%
9%
8%
2%
123456
41%
22%
16%
6%
15%
12345
»Rip Curl is a leading global action sports brand with a long-standing history in marketing, designing, manufacturing, wholesaling and retailing surfing apparel and
equipment
OverviewGeographic mix
(1)
Distribution mix
(1)
(Total revenue by channel)(Total revenue by region)
(Total revenue by product)
RIP CURL AT A GLANCE
1%
»Offers surf-related products,
from highly technical wetsuits,
boardshorts, swimwear and
watches to beach lifestyle
apparel, equipment and
accessories
»Core technical innovations
support the premium nature of
Rip Curl’s brand and drive
sales across broader offering
»Technical product
(1,2,3)
sales
represent approximately 40% of
revenue and are critical to
retaining support from Rip
Curl’s core surfing customers
»Operates a multi-channel
distribution model
»Design and development
capabilities across hubs in
Torquay in Australia, Costa
Mesa in the US and Hossegor
in France
Product mix
(1,3)
(1)Represents revenue for the financial year ending 30 June 2019 from management accounts.
(2)Technical products comprise wetsuits, equipment, watches, boardshorts and other products.
(3)Product mix excludes revenue from third party brands (which are predominantly sold from multi-brand stores), which are not tracked by product categories.
(4)Ozmosis is included in Rest of the World for the geographic mix. While it is located in Australia, it is considered separate to the underlying Rip Curl business.

GLOBAL FOOTPRINT WITH STRONG REPRESENTATION IN MAJOR SURF DESTINATIONS
»Rip Curl has a direct presence across 6 key regions through stores, design and manufacturing facilities
Note:Rip Curl metrics as at 30 June 2019. Rip Curl also has an additional 39 licensed and JV stores in other regions including the Middle East, Africa and South Pacific.
Owned regions
Licensed regions
Rip Curl Group
»Direct presence in 6 key regions
»c.6,000 wholesale doorways
»173 owned retail stores, 254
licensed / JV
»6 E-commerce websites
North America
»c.1,250 wholesale doorways
»30 owned retail stores, 10 licensed
»E-commerce website
»Global product hub located in
Costa Mesa, California
Brazil
»c.910 wholesale doorways
»3 owned retail stores, 79
licensed
»E-commerce website
Australia and New Zealand
»c.920 wholesale doorways
»118owned retail stores, 18 licensed / JV
»2 E-commerce websites
»Global head office and product hub in
Torquay, Victoria
Asia
»c.570 wholesale doorways
»3 owned retail stores, 85
licensed / JV
»E-commerce website
»Owned wetsuit
manufacturing facility in
Thailand (OnSmooth)
Europe
»c.2,350 wholesale doorways
»19 owned retail stores, 23 licensed
»E-commerce website
»Regional product hub located in
Hossegor, France

»Rip Curl's controlled distribution has traditionally focused on the wholesale channel and has progressively evolved towards direct to customer retail
WELL ESTABLISHED AND DIVERSIFIED COMMERCIAL CHANNELS
Overview
»Wholesale distribution to external retail customers
»Primarycontributor to overallcompany revenue
»Australia,North America and Europe are the largest
contributors from a region perspective
»Broad retail footprint of owned retail distribution
covering 173 owned physical locations worldwide
−90 flagship stores (stores located in prime tourist
destinations and iconic surf locations)
−26 owned outlet stores (stores distributing old
season stock)
−57 Ozmosis stores which offer multi-brand
products (operates independently to Rip Curl
business primarily in shopping centres)
»E-commerce is a relatively new channel of the Rip
Curl business
−Australia / New Zealand launched in 2010, North
America in 2011, Europe in 2014, Brazil in 2015,
Japan in 2016 and Indonesia in 2018
»Comprises 6 E-commerce websites delivering
products to Rip Curl’s 6 key regions
Key customers
Direct to consumer
Direct to consumer
WholesaleRetailOnline
Note:Rip Curl metrics as at 30 June 2019.

EXPERIENCED
LEADERSHIP
Rip Curl’s management team
is a strong combination of
long term internally
developed talent and
externally hired
professionals.
Tony Roberts
Legal Counsel
Michael Daly
CEO
Lori Showell
CFO
Lachlan Farran
GM Retail & Ops
Neil Ridgway
CMO
Brooke Farris
GM Digital
Rip Curl since 2002
Rip Curl since 2005Rip Curl since 2004Rip Curl since 2010Rip Curl since 1998
Rip Curl since 2003
BecChristian
GM Crew
Rip Curl since
)
2006
Michael Ray
GM Wholesale
Dylan Slater
President Nth America
Mathieu Lefin
GM Europe
Rip Curl since 2004
Appointed Oct 2018
Rip Curl since 2009
Appointed March 2019
Senior Management
Regional Heads
Nichol Wylie
GM Product
Rip Curl since 2002Rip Curl since 1994

WHAT’S
HAPPENING
IN SURFING
Ways the sport is growing
The surf apparel and
equipment industry is
expected to experience
growing demand following the
addition of surfing as an
official Olympic sport and the
development of wavepools.
Surfing participation levels
around the world continue to
grow year on year, with a
further significant boost to the
sport expected.
“The League has experienced tremendous growth in recent years
and has pioneered incredible innovations to transform surfing into
a remarkable, digital-first and world class sport that naturally also
transcends into the lifestyle sector so well.”
(Sophie Goldschmidt, WSL CEO)
Since a private buy out of the old Association of
Surfing Professionals in 2015 the World Surf
League have increased broadcast quality and
tripled the audience in online and offline channels
globally, driving increased awareness of the sport
and providing a platform for the athletes.
WORLD SURF LEAGUE
"We are already seeing increased
recognition of the sport across the
world and the Olympic Games will
provide an platform to further
showcase surfing to the masses.”
International Surfing Association president
Fernando Aguerre, The Australian
SURFING AT THE OLYMPICS
“For the multi-billion-dollar surfing
industry, the advent of custom-designed
waves that arrive regularly and
predictably is seen as having the
potential to help broaden surfing's
appeal and become something people
are willing to pay to experience”.
The New York Times
WAVEPOOLS
“The global market for surfing... is driven
by the growing interest in surfing as a
lifestyle sport, easy access to the sport
through surf parks and pools and
technology innovations. The market is
also benefiting from the fitness trend.”
Global Industry Analsyts,
Global Surfing Market, May 2016
INCREASED PARTICIPATION

»Rip Curl’s products are focused on core technical surf category, placing
emphasis on authentic alignment with the lifestyle of participants
»The global surf apparel and equipment market is underpinned by a number of
positive fundamentals:
−Increased participation rates in surfing across all key surfing regions,
reinforced by increasing female participation and rising interest from the
inclusion of surfing in the 2020 Olympics
−Increased online interest, reflected in the growth in web traffic for branded
surfwear
−Consumers reporting steady or increasing purchase intentions across most
categories in the key markets of Australia, the US and France
−Strong and consistent growth in key product categories of Rip Curl (primarily
equipment and wetsuits) across Australia, the US and France
»The surf apparel and equipment market in Rip Curl’s largest region, Australia,
expanded above the global average with a 2014-18 CAGR of 4.3%
»Overall, the surf products market has a strong, committed core consumer base
with steady growth in participation and spending
»Rip Curl operates in the c.A$11.3bn global surf apparel and equipment industry
LARGE GLOBAL INDUSTRY WITH GROWTH UNDERPINNED BY TECHNICAL PRODUCTS
(A$bn)
2014-18 CAGR
2.9%
3.6%
2.7%
9.0%
15.2%
24.5%
123
(%)
Source:GIA Report 2019, L.E.K. analysis.
(1)“Technical products” includes surf wetsuits, surfboards, boardshorts and other surf equipment.
(2)Based on expenditure by surveyed participants who are identified as either core surfers, casual surfers or surf-inspired consumers as defined on page 18.
Global surf apparel and equipment market
Core technical product expenditure (wetsuit and equipment) growth (2017-19 CAGR)
(2)
(1)
7.3
7.4
7.6
7.8
8.1
2.8
2.8
2.9
3.0
3.2
10.1
10.2
10.5
10.8
11.3
12345
Series1Series2
High growth technical product category is the key focus of Rip Curl

KathmanduRip Curl
COMPLEMENTARY CORE CAPABILITIES THAT BENEFIT THE
CONSUMER UNDER A COMBINED BUSINESS
Shared
»Global presence with established
distribution network in the US and
Europe
»Extensive social media, content
and influencer network
»Expertise in the wholesale
channel internationally
Technical products
Seasonal specialists
Outdoor adventure ethos
Commitment to core
customers
Brand building and
marketing
Kathmandu and Rip Curl’s respective strengths will be leveraged to create a combined business that excels
across product development, sales and marketing.
While maintaining the identity and cultural values of the individual brands.
»Experienced retail operations
capabilities
»Omni-channel expertise
»Track record in integrating
international brands
»Expertise in large customer
loyalty programs

NICHOL WYLIE
General Manager of Product

To create
innovative,
functional and
durable products
for..
“The Search”
OUR CORE PURPOSE

CORE
TECHNICAL
PRODUCTS
Technical product sales represent 40% of FY19 revenue
Critical to retaining support from our core consumer and retailer
base
Supports the premium nature of Rip Curl’s brand and drives sales
across broader offering.
Rip Curl recently won 10 awards at the Surf and Boardsports
Industry Association(SBIA) annual event.
Key awards were: Boardshort of the Year, Wetsuit of the Year,
Swim Brand of the Year, Mens and WomensBrand of the Year
and the prestigious award for product Innovation of the year.
•
•
•
•
•

WETSUIT MARKET
LEADER
FOR OVE R 30
YEARS
Leader in Innovation
and Technology
Leader in Function
Leader in Quality
and Service

MEN’S
SURFWEAR
Fanatical dedication to Boardshorts
Fabric Technology(stretch, quick dry, durability,
hand feel, waterproof)
Sustainability –Saltwater Culture
Continuous feedback and testing from Rip Curl’s Pro
Men's Surf Team.
Immense focus on the beach culture –Summer and Winter.
•
•
•
•
•

WOMEN’S
SURFWEAR
Fanatical dedication to Swim
Designed with Style and Performance in mind.
Fabric Technology (Comfort, durability, fabric interest)
Sustainability –Saltwater Culture, Eco Swim Essentials
Continuous feedback and testing from Rip Curls Pro Women’s
Surf Team.
Immense focus on the beach culture –Summer and Winter.
•
•
•
•
•
•

TECHNICAL
EQUIPMENT
(Men’s & Women’s)
Fanatical dedication to Travel on “The Search”
Fabric Construction and Technology
(light weight, functional and durable)
Sustainability –Saltwater Culture
Athlete Integration –Backpacks, Wheelie Bags, Surf Access
•
•
•
•

WATCH
TE
CHNOLOGY
Fanatical dedication to Surf Watches.
Tide watches let the surfer know what the tide is doing
at a glance.
GPS Technology lets the surfer track every surf and every
length of ride
Service –warranty and repairs.
Athlete Integration
•
•
•
•
•

KEY
AREAS OF
FOCUS
To continue to be regarded in all that we do as the
Ultimate Surfing Company
To continue to develop market leading innovative products
(tech and apparel)
To leverage the strengths of Kathmandu into Rip Curls offering
whilst keeping Rip Curls DNA.
To produce Quality Surf Products the distinguish Rip Curl from
its competitive set
To stand behind our products with best in class product service.
•
•
•
•
•

The Search
Leadership
Technology
Tradition
Crew
Fun
Irreverence
Respect
Durability
Reliability
Belief
A clearfilterwhichcaptures ourspirit and whichweput all
productideasand marketing messages throughto decide
if theyare on brand for Rip Curl.
THE
RIP CURL BRAND
VALUES
THE DNA OF THE BRAND

THE ULTIMATE SURFING COMPANY
Born in Bells Beach, Australia, in 1969, Rip Curl has always been a brand on The Search
“The Search was the driving force that led to the creation of Rip Curl... We loved charging
into the unknown and the journey that waited. It was about the great sense of adventure,
anticipation, curiosity and the chance to score great uncrowded waves.
Rip Curl helps us live this life...” –Doug ‘Claw’ Warbrick (Rip Curl Co-Founder)
4

USAustraliaFrance
»Rip Curl’s brand is highly recognisable across surfwear, wetsuit and equipment categories in Australia, the US and France
»Demonstrable brand affinity with core surf customers who value product functionality and performance showcased by world classpro team and events program
HIGHLY RECOGNISABLE, GLOBAL BRAND
#2 NPS
(1)
of all
wetsuit brands
#5 NPS
(1)
of all
wetsuit brands
#1 NPS
(1)
of all
surfwear brands
Key highlights
Surfwear
»High brand awareness and purchase conversion across all
categories of consumers (from casual to core surfers) in
Australia
»Second highest purchase penetration in France, with most
support from core and casual surfers
Wetsuits
»Market leader for wetsuits in Australia, with strong
purchase penetration driven by technical product
excellence
»Wetsuits resonate most strongly with core and casual
surfers across all markets, supported by Rip Curl’s
technical product focus
Equipment
»Brand awareness among core, casual and surf-inspired
customers is high, driven by product quality and functional
performance
99%
93%
91%
83%
78%
78%
86%
83%
82%
Brand awareness (2019)
SurfwearEquipmentWetsuits
Source:L.E.K. analysis.
Note:Core surfer defined as someone who surfs 8+ times per year; casual surfer as someone who surfs 1-7 times per year; and surf-inspired consumers are those who have an aspirational surf and beach lifestyle but do not surf.
(1)Net promoter score, determined by % promoters -% detractors.
5

World Class
Athletes
The Ultimate
Sports
Event
Platform
Content
Creation
Advertising
Distribution
Social Media
(1)
2.0m+ fans
globally
2.0m+
Followers
(2)
119k
subscribers
200k+ customers reached daily
PART OF THE FABRIC OF AUTHENTIC GLOBAL SURF CULTURE

Events
•World Surf League Rip Curl Pro Bells (April); Rip
Curl Pro Portugal (October) are six month anchors.
•Rip Curl GromsearchOur global junior event
series runs across the planet and recruits the next
generation.
•Padang Cup premier tube riding event for non –
WSL “outlaws” connects with a different audience.

Content
Creation
•Integrated Merchandise and Marketing
Campaigns for all core products across all online
and offline channels, in both media and sales ...
•Centralisedcontent creation to avoid waste.
•Brand first content that reflects our Vision of
being the ultimate surfing company in all that we
do...

Key Areas of
Focus
•Continued centralisation of content and
campaigns.
•Marketing driving footfall to retail and traffic
online, better use of CRM to understand
customer and begin RC Loyalty Club.
•Staying on brand and authentic to the Vision of
being “Regarded as the Ultimate Surfing
Company in all that we do...”

Group Chief Financial Officer
Chris Kinraid

Creating a NZ$1.0bn company
Rip Curl transaction expected to deliver meaningful EPS
accretion –in excess of 10% pre-synergies
INVESTOR DAY 2020

•Kathmandu intends to maintain a conservative capital structure, however maintain investment levels where
appropriate to enable growth
•We are comfortable with the pro-forma debt levels of 1.5x Net Debt / EBITDA following the acquisition, we intend to
reduce net debt to ~1.0x -1.1x EBITDA by the end of FY21
•Highly successful syndication of debt facilities completed with $A355m of debt facility, maturing October 2022
•Strong group of funding partners achieved and well supported by Australasian banks
•Leasing standard to be reported for 1H FY20, -key metrics to be adjusted; no impact on cash flow or covenants
Financial strategy: balance sheet
KMD to maintain a conservative capital structure
INVESTOR DAY 2020

•3 strong cash generating brands
•Focus on inventory management, targeting improved
stock turns for each brand
•Global sourcing strategy implemented by Rip Curl
expected to drive improved inventory levels
•Capex investment levels to support integration, omni-
channel strategy and enhanced store optimisation c$30m
annually
•Dividend payout remains flexible between 50-70% of
NPAT depending on trading performance and investment
requirements
•Net debt reduction to meet leverage targets
Financial strategy: strong cash flow
Brands have a history of strong cash flow generation
INVESTOR DAY 2020
0
20
40
60
80
100
120
140
FY16FY17FY18FY19
$m
NZD
Kathmandu Cash Flow Sources and Uses
CapexInterest PaidDividends
AcquisitionsOperating Cashflow

Supply Chain and Sourcing
•Focus areas on common fabrics and supplier consolidation
•Alignment of terms, standards, compliance and quality
•Combined brand sourcing workshops have been held with opportunity charters in place
Systems and IT
•Kathmandu’s online capabilities can be leveraged to accelerate growth in Rip Curl’s online channel with common
online platforms
•Priority on online capability and value generating systems investment
•Leveraging existing Rip Curl investments and infrastructure to support D2C internationally for Kathmandu and Oboz
Other
•Opportunity charter completed for cost synergies across spend categories
•Activities underway to drive cost improvements across the Group
•Leveraging Rip Curl’s international capability to enable wholesale growth for Kathmandu
INVESTOR DAY 2020
Synergies expected over the medium term
Key work streams have been identified and progressed

INVESTOR DAY 2020